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I got this question the other day.

It seemed like a good idea when I started. But, I am not making any money on my offering, nor do I seem to be gaining traction. Is there any clear benchmark on when I should shut things down?

The focus of this blog--not surprisingly giving the channel it appears in--is on starting things. Creating something new is the place where entrepreneurs excel.

But not every idea is a winner. And not every winner stays a winner forever.

So, this time, let's talk about when to stop something.

Specifically, when do you know it is time to stop selling a product or service?

There are always four extremely clear signs:

1. You are going to run out of money, so you have no choice. The loses are so large (and show no signs of slowing) that you are putting your company at risk by continuing. Contrary to popular myth, persistance does not always carry the day. Doing the same think over and over and over again and expecting a different result really is the the definition of insanity.

2. There are no repeat orders and/or there are extremely high returns. Without repeat customers, and strong word of mouth, you can’t stay in business very long; your marketing costs are simply going to be too high.

3. A new competitor, who is so much better, comes on the scene and the only way you can compete with them is on price. Competing on price is almost never the way to go. Someone who has more money than you can always undercut you. (They will absorp the loses until you go out of business.)

Now it is possible that the company with the lowest prices doesn't truly understand what its costs are, and that's why it is charging such low prices. But that's no consoliation to you. Eventually, they will run out of money, and you will too, if you match their prices.

4. You decide you want to do something else, a decision that could be based on reasons 1, 2 or 3.

That last point is no small thing. There is simply no way you are going to give it your full effort if your heart isn’t in it at least to some degree.

And there is no way you will have the sufficient gumption necessary to overcome the inevitable problems you are going to face, unless you are truly committed.

If the commitment is gone, you might as well stop now because eventually it is going to show up in the product or service you are providing.

It's okay to quit

It is more than okay to kill off a product or shut down a service you are offering.

In fact, it will free up capacity for something that could be more profitable.

And there is absolutely no reason to feel guity about it, as long as you learned what went wrong.

Understand why things have come to an end, and move on to your next idea.